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Storm Lake, Iowa -- Mark Grey

MEATPACKING AND THE MIGRATION OF REFUGEE AND IMMIGRANT LABOR TO STORM LAKE, IOWA

A Synthesis

Mark A Grey

Department of Sociology, Anthropology, and Criminology

University of Northern Iowa

Cedar Falls, Iowa 50614

(The Complete Version of this and Other Work by Grey on Storm Lake Are Available from the Author)


Storm Lake, Iowa, epitomizes rural midwestern communities transformed by "new-breed" meatpacking plants. The most visible impact of this transformation has been this community’s changing demography, attributable almost entirely to immigration. This paper explores the relationship between the changing technology and production goals of the meat packing business and the influx of refugee and immigrant groups into this rural midwest community. It also examines transformations within the community that have been attributed to this relationship and the social concerns and policy issues that they raise.

Meatpacking has been a cornerstone of the Storm Lake economy for decades. Currently, Storm Lake is heavily dependent on two such plants—an IBP pork packing plant that employs about 1,300, and a Bil-Mar Foods turkey plant (owned by Sara Lee) that employs about 500. According to one estimate, these plants provide nearly 75 percent of the area’s manufacturing jobs.

The plant that eventually became IBP first opened in 1935. Between that time and 1981, the plant had two owners and underwent expansion. Its owner immediately prior to IBP was Hygrade Food Products of Indianapolis, Indiana. Hygrade was a typical "old line" pork packer, which meant that most of the product was shipped in sides to groceries, where skilled butchers cut the meat into consumer-size pieces. Work at the plant was difficult and physically demanding, but workers enjoyed good pay, production incentive bonuses, and union representation, and they reported harmonious relations with the plant managers.

The Hygrade workforce was primarily male and of European descent. Only in its last few years of operation, in the late l970s to early 1980s, did a few women work on the plant floor. The plant’s workforce was from Storm Lake and surrounding communities. Prior to the mid-1980s, Storm Lake was almost exclusively Anglo, and this homogeneity was reflected in Hygrade’s workforce. Many of Hygrade’s workers put in thirty years or more at the plant, reflecting a low turnover. For many, their jobs supported a comfortable, middle-class lifestyle. Average annual incomes were about $30,000, but some senior workers earned up to $40,000 or more in Hygrade’s last year of operation.

In October 1981, Hygrade closed its plant and Storm Lake lost five hundred jobs. Community leaders immediately set about attracting a new buyer for the plant.

In April 1982 IBP announced its purchase of the plant for $2.5 million. After extensive renovation, this became the company's first pork-packing facility (IBP previously had processed only beef.) IBP’s move into pork processing signaled a major transformation of the industry.

When IBP opened its doors in September 1982, its workforce did not resemble the old Hygrade crew. Hundreds of former Hygrade workers applied, but fewer than thirty were hired. IBP would look beyond the Storm Lake community for its laborers. Beginning wages were only $6 an hour, and health benefits become available only after six months on the job. (Today, starting wages are $7 an hour.) The new plant had higher productivity expectations than the old plant. Injury rates climbed, and high employee turnover increased the strain on local labor supplies.

Immigrants and refugees were the new labor sources identified to staff the plant. Storm Lake had some experience with minority newcomers before the IBP era. Between 1975 and 1979, twenty-four families of Tai Dam (or Black Tai) refugees were resettled in the Storm Lake community by the Iowa Bureau of Refugee Services (BRS). Iowa was the host to 98 percent of all the Tai Dam brought to the United States as part of a massive effort to resettle this group from camps in Thailand. Most of these refugees eventually left Storm Lake, but some took jobs, saw children graduate from Storm Lake schools, and established themselves as members of the predominantly Anglo community.

The new meatpacking workforce would include three groups of newcomers to Storm Lake: Lao refugees, a small influx of Mennonites from Mexico, and most recently a large and growing flow of Mexican/Latino workers into the community. Since 1985, most new workers in the local meat plants have been minority refugees and immigrants.

The 1990 Census found a total population of 8,769 living in Storm Lake. More recent estimates place the population at over 10,000, with Southeast Asians and Latinos making up most of the population growth.

The First Wave of Migration to Storm Lake: Lowland Lao

In the mid- to late-1980s, ethnic lowland Lao refugees began to arrive in Storm Lake. These new refugees shared characteristics with the Tai Dam, including a similar language, and both groups were identified as Laotian, but the groups considered themselves culturally distinct. This distinction was difficult for Anglo residents to perceive and contributed to their expectations that the more recently arrived Lao would assimilate themselves into the community as had the Tai Dam. A major difference between these groups in relation to the larger community was that the Tai Dam in a sense had been invited to the community, and their arrival was facilitated by the sponsorship of churches and families. Later migrations of Lao and other groups were in response to opportunities in local industry and not the result of the community’s effort to provide new homes to immigrants.

The Tai Dam, for the most part, were or had become Christian, while most Lao were Buddhist. Lao (with about 149 households, or 504 individuals), according to a 1991 BRS survey, outnumbered Tai Dam in Storm Lake. Storm Lake was host to the original Tai Dam settlers, while most of the later Lao newcomers were "secondary migrants," coming to Storm Lake after initially being settled in other communities in Iowa or, by 1991, from twelve different states and Washington, D.C.

The Lao may have been drawn to Storm Lake by its jobs in food processing, but their actual move into the community and acquisition of jobs was linked to kinship relations and to a patron-client system (Tai Dam patrons, Lao clients) that developed from within the IBP organization. Storm Lake’s initial settlers (primarily nuclear families) were part of much larger families, or kinship networks, involving Laotian immigrants originally settled in other parts of Iowa and the U.S. Many of these people became secondary migrants to Storm Lake.

I studied in-depth one of these Lao kinship networks in Storm Lake. It illustrates the role of kinship and patronage in building the IBP workforce. Everyone in this network was related, primarily through affinal ties. The network was initiated by one man who had heard about jobs at IBP through the refugee community in Oklahoma. His success at establishing himself in storm Lake initiated the network.

In all, twenty-two adults in this network were hired by IBP. None of these individuals were hired through direct recruitment by IBP; all became part of the plant’s workforce through migration initiated by kinship ties. There were great advantages in this for the company: these new workers arrived without the expense or legal responsibility associated with active company recruitment.

Among the 149 Lao households in Storm Lake counted in 1991, 125 household heads worked at IBP. By 1992, more than 300 Lao worked at IBP, making up more than a fourth of the company’s entire workforce. How these new arrivals acquired jobs at IBP was through the kind of patronage mentioned above. The Southeast Asian Personnel Representative at IBP was among Storm Lake’s initial Tai Dam settlers. Fluent in English, deacon in a local church, an active member of civic organizations, he was recognized by the Anglo community and served as a link between that community and the Tai Dam and lowland Lao. As the only manager at IBP who could speak Lao, this man helped newcomers apply for and obtain jobs (no non-English-speaking Lao could become employed without his help). Thus, he served as a patron. He also became a de facto supervisor, as Anglo supervisors relied on him as to communicate with workers and workers depended on his accurate translations from Lao to English in order to keep their job security.

The Second Wave of Migration: IBP Recruitment of Mennonites from Mexico

In 1992-1993, about seventy individuals arrived in Storm Lake from Mexico, where they had been recruited by IBP. IBP had hired a Texas-based recruiter familiar with the Mennonite community and who spoke Plattdeutsch (low German) to approach men in settlements in Chihuahau Province, tell them about jobs in Storm Lake, and assist them in obtaining immigration papers. These recruits, who also paid IBP’s recruiter, easily obtained green cards. (Their families, for the most part, entered the U.S. illegally, without documentation.)

These people were remarkable for the diversity of languages, citizenships, nationalities, and immigration status in each family. For example, in one family the father had Mexican citizenship, the mother was Canadian, and the children were Mexican or American citizens. Usually only the adult women spoke "high" German. The children usually spoke Spanish and English (depending on how much time they spent in American schools). Family communication took place in Plattdeutsch.

The Mennonite migration was small, but it marked a turn towards direct recruitment by IBP of workers from Mexico.

The Third Wave: Mexican/Latino Migration to Storm Lake

Until 1992, Mexican/Latino migration to Storm Lake was minimal. In that year, only about eighty Latinos worked at IBP. However, this situation changed rapidly.

After IBP stepped up efforts to recruit Latinos in Texas, Southern California and Mexico, more Latinos—-initially mostly men without families--began to arrive in Storm Lake. By 1994-95, there were 117 Spanish-speaking children in Storm Lake schools.

For many Storm Lake residents, the arrival of Latinos signalled that the costs of IBP’s presence, and its hiring practices, had become too high. Whether this was based on stereotypes about Latinos or on social changes that coincided with the increase in Latino population in Storm Lake is unclear. Interviews with long-time residents and health care providers revealed criticisms that reflected stereotypes about Mexicans vs. Asians.

The lower social status attributed to Latinos may have been influenced by their legal status. The Lao—-whether those sponsored through formal settlement programs or those who arrived as secondary migrants—-had refugee status. The Mennonite workers held green cards. How many Latino newcomers were documented was unknown, and whatever uneasiness this raised for locals was probably further increased by the high-profile national debate about immigration, which continues. Restrictionist Republican presidential candidate Patrick Buchanan chose Storm Lake as a campaign stop to highlight the town’s experience with immigrants as an example of a serious problem.

The most dramatic episode in reaction to Latino presence in the Storm Lake workforce and community was a raid of the IBP plant on May 10, 1996 by the Immigration and Naturalization Service. The raid seemed to validate residents’ concerns about illegal immigration. The INS arrested 64 illegal aliens, all Mexican nationals except for two Guatemalans and two Hondurans. The following weekend local police and the state highway patrol arrested 14 more immigrants. The sweep included checks of homes and, reportedly, roadblocks that stopped all cars with Latino occupants. Most arrested immigrants were immediately deported.

Storm Lake had become part of the new international labor market when Lao and other refugees and immigrants arrived to take jobs at IBP. Just how deeply the community had become a part of this new labor structure was driven home by the INS raid on Storm Lake’s major industry.

Costs and Consequences of the New Migrations

Community leaders and policy makers measure the costs of an expanding and diversifying population by citing changes in the areas of education, health care provision, and crime rate. In Storm Lake, changes in each of these areas coincided with the entrance of Lao, Mennonite, and Latino immigrants as workers in the community.

Schools

The challenges of immigration to Storm Lake schools are not unlike those of other school districts with a large non-English-speaking population. Schools must address the needs of students who speak no English or speak English at levels below that of their cohorts while at the same time considering unique cultural differences within the school population. Migrant students often lack academic records, and schools are not always equipped with appropriate testing to determine student needs. Disruption of school progress is another problem faced by educators in communities like Storm Lake, where high job turnover means that a student’s family might not remain a permanent part of the community. Curriculums are not set up to accommodate this.

The costs of meeting immigrant children’s educational needs include hiring new teachers and aides to provide ESL instruction. The number of non-English-speaking students counted in Storm Lake schools rose from 28 in 1982-1983 to 236 in 1992-1993. By 1994—1995, those numbers had risen to 291 students speaking Spanish, Tai Dam, Lao, Cambodian [Khmer], German, Korean, Chinese, and other languages. Until 1994-1995, the largest single language group among students was Lao (numbered at 144), followed by Spanish-speaking students (117). In the following year, 1995-1996, the total number of non-English-speaking students rose to 373. The number of Spanish speakers rose to 202, with Lao dropping to second place at 139. Information on kindergarten enrollment is published in Lao, Spanish, and English. Storm Lake schools include other minority students as well, including African-American and Native American children.

Monies to fund services for this diverse population have not been consistent or in line with the schools’ requirements. In 1992-1993, Storm Lake schools received $157 thousand in federal funds for ESL instruction. By 1994-1995, however, only $127,575 was available, and federal contributions were scheduled to end altogether. Despite resistance to shifting funds from mainstream programs, the school board voted to use reserve monies to fund the ESL program at $100 thousand in 1995-1996. School board members proposed that the distruct fund only half of the costs and ask the IBP and Bil-Mar plants to provide the other $50 thousand. This proposal, which did not pass, would have declared those companies’ responsibilities for the influx of newcomers, a responsibility that both corporations avoid admitting.

Health Care Provision

With demographic changes in Storm Lake’s population, health conditions not previously seen in the community appeared. For example, in 1994, 42 percent of students in the high school ESL program tested positive for tuberculosis, and preventive medication was administered to over 50 students, all of whom were refugees and immigrants.

Most problems faced by clinics and the hospital were associated with language differences and with population transience that resulted in uncompensated care. At the community’s largest clinic, patients had to bring their own translators. Overcoming language barriers caused doctors to take up to three times longer to make diagnoses, leaving less time for other patients. This became a serious problem, because the same number of doctors were faced with patient visits that grew from 42,000 in 1984 to 57,000 in 1993, a 35.7 percent increase. Had translators been hired, the costs would have been passed on to patients and insurance companies, or else added to the clinic’s increasing uncompensated care costs. Such costs were reported by the clinic’s director as minimal prior to the mid-1980s, but in 1994 the clinic charged more than $10,000 each month for services that were not paid, excluding the write-offs associated with Medicare and Medicaid.

Buena Vista County Hospital saw its patient visits grow to 35,000 in 1993. Of these, a growing percentage were non-English-speaking minorities who presented the same language challenges experienced by the clinic. However, unlike the clinic, the hospital was funded by Buena Vista County taxpayers and therefore was not allowed to turn patients away for any reason, including lack of payment. One consequence of this difference in service between the clinics and the county hospital was that the hospital emergency room became a provider of last resort for many low-income newcomers, and emergency room visits doubled between 1984 and 1994, up to 700-800 a month.

By 1994, unpaid bills were approaching a crisis level, with uncompensated care the fastest growing part of the hospital budget. While some of this reflected contractual write-offs associated with Title XIX and Medicare, an increasing proportion was due to the unpaid bills of transient newcomers. In 1993 total uncompensated care amounted to $40-$50 thousand per year, or only 1 to 1.2 percent of the hospital’s budget. By 1993, the hospital wrote off $1 million, or 13 percent of its total budget, and the projection for 1994 was $1.2 to $1.4 million.

As in the case of educational expenses for newcomers, employer responsibility for the costs of health care to new immigrants has been raised. IBP’s insurance package, which begins only after six months of employment, has been cited as a factor contributing to the rise in uncompensated care expenses. Not only are new hires responsible for their own health-related bills until IBP insurance coverage begins, but many new hires do not reach the six-month mark, and their health bills go unpaid.

Crime

Nothing raised the concerns of Storm Lakers I interviewed more than the community’s rising crime rate and the perception by residents that Storm Lake was becoming an unsafe place to live. In 1994, one resident told me that Storm Lake had the "highest number of police per capita in the state." His point was not how many new police were hired, but that they had to be hired. This was also reflected in the police department budget: in 1994-1995 it was $820,886--$285,671 more than in 1990-1991.

In 1994, 599 serious crimes were reported, a rate two and a half times those reported in other Iowa cities of the same size. In the same year, the police department received 39,191 calls for service (averaging 109 calls a day). This was an increase from 10,000 in 1990. Between 1990 and 1993, calls about fights/disturbances grew from 59 to 272. Burglary calls tripled, to 145, in the same period, which from a statistical standpoint meant that Storm Lake residents were more likely to be burglarized than residents in urban Des Moines.

The number of inmates in the Buena Vista County Jail also increased dramatically. In 1992 the jail held 804 total inmates, 63 more than in 1991 and 211 more than in 1990. Of the inmates in 1992, 32 were Asian, 51 were African-American, and 120 were Hispanic. Inmates not speaking English numbered 101. By 1994, minorities accounted for 33.9 percent of non-traffic-violation arrests.

The police department hired more patrol and community service officers to work directly with Latinos and Southeast Asians. Two officers fluent in Spanish or Lao were hired to act as liaisons between newcomers and the police department. Neither carries a gun. The police department also encouraged citizens to organize neighborhood watch areas. Attempts to organize these had failed in the 1980s due to lack of perceived need. Today, twenty-one Storm Lake neighborhoods are organized.

Policy Issues

The primary policy issues raised by the experience of Storm Lake involve defining who is responsible for changes in and costs to the community when large numbers of workers, particularly non-English-speaking immigrants, some undocumented, are drawn to or directly recruited for jobs. Can IBP’s hiring practices be held responsible for refugee and immigrant migration to Storm Lake? Or has IBP simply been particularly adept in identifying and tapping into extant or potential migrant networks? What makes migration viable is the availability of jobs. The use of refugee and immigrant workers demonstrates industry’s ability to acquire flexible and low-wage workers from areas beyond the community where the industry itself is based. In many cases, industry is able to do this without incurring the expense of direct recruitment. This enables plants to avoid dependence on local, more limited and potentially more expensive, labor.

Local Storm Lake workers who were once represented by strong unions, earned good wages, and were predominantly Anglo, became increasingly disempowered because their proximity to the plant (and even their skills and experience) no longer assured employment. Former Hygrade workers found themselves competing for jobs with workers in the global labor market.

Immigrant and refugee workers recruited by Iowa industries are protected by an Iowa law, the 1991 "Non-English-Speaking Employees Law" (Iowa Code, 1991). This law requires that non-English speakers recruited from more than 500 miles away read and sign a document outlining 1) the minimum number of hours the employee can expect to work each week; 2)hourly wages, including the starting hourly wage; 3) responsibilities and tasks of the position of employment; and 4) known health risks to the employee. The law also stipulates that if an employee quits within the first four weeks, the employer must pay for return transportation. This bill was clearly aimed at meat packers and has been referred to as the "IBP Bill."

This law does not protect all migrant workers, however. For example, the plant clearly benefited from the arrival of Lao newcomers, but it is not responsible for Lao who became IBP workers because it did not recruit them. The law does not even apply to all cases involving recruited workers. For example, if workers are fired, the employer is no longer responsible for their return transportation. While the IBP Bill was designed primarily to protect the rights of non-English-speaking workers, it is also a form of state intervention in labor migration. As Storm Lake’s experience suggests, the law has not curtailed recruitment.

The policy concerns raised here can be stated in this way: Should industries be held responsible for costs associated with the migrants they hire and not just those they actively recruit? Storm Lake residents are divided over whether or not IBP and Bil-Mar are directly responsible for newcomers and the costs to local schools and other public services. Those who believe the industry is responsible point to its reliance on imported workers and its recruitment efforts. Defenders of the plants respond that population changes are part of general demographic shifts in American society. Storm Lake, they argue, simply reflects our changing society.

Different perspectives on IBP’s recruitment and its perceived link to the rising crime rate provide another example of the divided opinion regarding who is responsible for particular kinds of societal change. Crime became the dominant issue of the 1994 election for county attorney, when the sixteen-year democratic incumbent was challenged by an attorney who accused IBP of "social pollution" by recruiting workers with criminal backgrounds. IBP responded that it did not go outside the community to recruit people with criminal records. The company noted their concern about the crime rate and denied having any part in it. "When we screen job applicants, we ask if they ever have been convicted of a felony. If the answer is yes, we seek additional information before making a decision whether to hire them."

Business leaders, the most vocal supporters of IBP, attempted to keep the police department from faxing news about major crimes to the media. The president of the chamber of commerce argued that competition between Storm Lake’s two newspapers led to the sensationalizing of crime incidents and to perceptions that crime was rampant in the community. These efforts to downplay the problem of crime have usually been accompanied by a defense of IBP. "All rural communities are changing," goes the argument, "not just Storm Lake, so you can’t blame IBP."

Meatpacking communities are also affected by employee turnover. There is evidence that high wages alone did not lead to the downfall of old plants. Nevertheless, lower wages and benefits helped convert meat packing into an industry with high turnover. In their first years of operation, plants often experience turnover rates of 30 percent a month or higher. Rates go down through time, because a core of long-term workers make up for those who work a few months or less. In today’s plants, even after years of operation annual turnover rates of 72 to 96 percent have been noted.

Academics and meat packing officials debate whether the industry benefits from, and fosters, high turnover rates. The industry points to the high costs of training new workers. But from a policy perspective, this argument is suspect because packers are often able to acquire state-supported job training in programs that help defray training expenses. Typically, these involve a form of tax-increment financing authorized by the state. Contracts are made with community colleges which sell bonds to cover the expenses. The bonds are then repaid by a combination of diverted property taxes from the plant and payroll withholding taxes. (The community colleges keep their share of administrative fees.) The state may reimburse the plant for up to one half of new workers’ wages for ninety days. New hires earn the entry-level wage, but half of that wage may not even be paid by the company. In short, stable workers cost more. If workers quite after the 90-day period, replacement workers cost less because they will be eligible for training funds. High turnover means lower labor costs subsidized by the state. IBP is the largest single recipient of Iowa’s new job training funds, receiving $7,055,000 through fiscal year 1993.

Conclusion

As a center of agricultural production, Storm lake was linked to the global economy before IBP’s presence. But in the 1980s, the community became an integral part of the international labor market with migrations of Lao, Latino, and other workers. The economic benefits of active participation in international markets must be weighed against the costs. In the case of Storm Lake, there are economic and social costs. To many people, the costs now outweigh the benefits.

Storm Lake provides a number of lessons for social scientists and other communities considering hosting large meat packing plants or other industries that rely on immigrant labor. Storm lake’s experience influenced a rapid grassroots opposition to a new meat plant in nearby Spencer, Iowa. And, after IBP announced plans to build a plant in Edgecomb County, North Carolina, local opposition groups relied heavily on events in Storm Lake and other meat packing towns to build their case against the proposal.

How policymakers respond to the growing body of evidence on the costs to communities of low-skill immigrant-intensive industries remains to be seen. In Iowa, most legislators steer clear of the issue of immigrant labor and employer responsibility because, on the surface, the debate seems to pit the creation of jobs and rural economic growth against social change. But as social scientists have attempted to point out, it is not simply a case of rural economic survival as many contend. A forthright public debate about industry hiring practices would benefit rural communities, allowing them to make informed decisions about economic development based on their unique characteristics rather than on political arm twisting.